Following years of severe sanctions, the United States will now allow U.S. companies to do business with Venezuela's state-owned oil and gas company Petróleos de Venezuela S.A. (PDVSA).
The Treasury Department eased some sanctions on the company on Wednesday, allowing PDVSA to directly sell Venezuelan oil to U.S. companies and on global markets.
The Treasury's license is designed to incentivize new investment in Venezuela's energy sector and seeks to benefit both the United States and Venezuela while increasing global oil supply, a Treasury official told The Associated Press.
In addition, the White House said the Trump administration would waive for 60 days the Jones Act, a century-old law requiring ships transporting goods between U.S. ports to be U.S.-built, owned and crewed, effectively limiting foreign vessels from domestic trade. As noted by the outlet, the law has long been blamed for making gas more expensive.
White House press secretary Karoline Leavitt said the Jones Act waiver would help "mitigate short-term disruptions to the oil market" during the Iran war and would "allow vital resources like oil, natural gas, fertilizer, and coal to flow freely to U.S. ports."
The price of crude oil continues to rise following the United States and Israel's attack on Iran, pushing gasoline prices higher. In just one month, the price of a gallon of gas has increased by more than 80 cents, averaging $3.842 per gallon, according to data from the American Automobile Association (AAA).
The ongoing military conflict has also caused a significant decrease in ship traffic through the Strait of Hormuz, a crucial maritime route between the United Arab Emirates and Iran, where about 20% of the world's oil typically passes, as reported by NPR.
As noted by The Associated Press, although the license granted by the Treasury Department provides targeted relief from sanctions, it does not lift the penalties entirely. It allows companies that existed before Jan. 29, 2025, to buy Venezuelan oil and engage in transactions that would normally be banned under U.S. sanctions, allowing Venezuela, which has the largest oil reserves in the world, to reenter global markets.
Since the U.S. launched a military operation on Jan. 3 to capture Venezuelan President Nicolás Maduro, President Donald Trump has said his administration would "run" Venezuela and its oil.
As expected, the decision to allow U.S. companies to buy Venezuelan oil comes with its own set of rules. As noted by The Associated Press, payments cannot go directly to sanctioned Venezuelan entities such as PDVSA, but must instead be sent to a U.S.-controlled account, allowing the United States to oversee the cash flow.
The report also notes that deals involving Russia, Iran, North Korea, Cuba and some Chinese entities will not be allowed. Similarly, transactions involving Venezuelan debt or bonds will not be permitted.
Originally published on Latin Times
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